Canada's Minister of International Trade Francois-Philippe Champagne, Chile's Foreign Minister Heraldo Munoz and New Zealand's Trade Minister David Parker, pose for a photograpghers before a signing ceremony of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, CP-TPP, in Santiago, Chile, Thursday, March 8, 2018. (AP Photo/Esteban Felix)

A man shout slogans during a demonstration against the signing of the Trans-Pacific Partnership, TPP, outside La Moneda presidential palace, in Santiago, Chile, Wednesday, March 7, 2018. Protesters voiced their opposition to the signing of the 11-country pact that includes Peru, Mexico, New Zealand, Canada, Australia, Malaysia, Japan, Singapore, Vietnam, Brunei and Chile. (AP Photo/Esteban Felix)

A woman places banners on the sidewalk, against the signing of the Trans-Pacific Partnership, TPP, outside La Moneda presidential palace, in Santiago, Chile, Wednesday, March 7, 2018. Protesters voiced their opposition to the signing of the 11-country pact that includes Peru, Mexico, New Zealand, Canada, Australia, Malaysia, Japan, Singapore, Vietnam, Brunei and Chile. (AP Photo/Esteban Felix)

A man holds a sign against the signing of the Trans-Pacific Partnership, TPP, during a demonstration outside La Moneda presidential palace, in Santiago, Chile, Wednesday, March 7, 2018. Protesters voiced their opposition to the signing of the 11-country pact that includes Peru, Mexico, New Zealand, Canada, Australia, Malaysia, Japan, Singapore, Vietnam, Brunei and Chile. (AP Photo/Esteban Felix)

People take part in a demonstration against the Trans-Pacific Partnership, TPP, outside La Moneda presidential palace, in Santiago, Chile, Wednesday, March 7, 2018. Protesters voiced their opposition to the signing of the 11-country pact that includes Peru, Mexico, New Zealand, Canada, Australia, Malaysia, Japan, Singapore, Vietnam, Brunei and Chile. (AP Photo/Esteban Felix)

11 nations to sign Pacific trade pact as US plans tariffs

11 nations to sign Pacific trade pact as US plans tariffs

By EVA VERGARA and LUIS ANDRES HENAO

Mar. 08, 2018

https://www.apnews.com/be222fae500f49f78ca81a23cf941833

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SANTIAGO, Chile (AP) — Trade ministers from 11 Pacific Rim countries signed a sweeping free trade agreement Thursday to streamline trade and slash tariffs on the same day that President Donald Trump was expected to formalize new tariffs on aluminum and steel to protect U.S. producers.

Trump withdrew the U.S. from the Trans-Pacific Partnership last year, causing fears that it would not prosper without its most influential country. But the remaining 11 members pressed ahead, saying they were showing resolve against protectionism.

The ministers dropped key provisions that the Americans had required on protection of intellectual property, among others. The renegotiated pact signed in Chile's capital was also renamed the Comprehensive and Progressive Trans-Pacific Partnership, or CPTPP.

The pact includes Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Its success highlights the isolation of the U.S. under Trump's protectionist rhetoric on trade and his "America first" philosophy.

"It leaves the U.S. at a disadvantage from both a trade and a broader strategic perspective," said Joshua Meltzer, senior fellow in the global economy and development program at the Brookings Institution. "It is now a trade bloc that discriminates against the U.S."

Meltzer said the United States' ability to shape the rules of trade in the Asia-Pacific region "is very much diminished."

The U.S., originally the biggest TPP economy, was one of the trade deal's strongest supporters before Trump took office. Trump has said he prefers country-to-country deals and is seeking to renegotiate several major trade agreements, including the North American Free Trade Agreement that includes the U.S., Mexico and Canada.

This is "a strong sign against the protectionist pressures, and in favor of a world open to free trade, without unilateral sanctions and the threat of trade wars," Chilean Foreign Minister Heraldo Munoz said.

The European Union said this week that it is ready to retaliate against Trump's tariffs — of 25 percent on imported steel and 10 percent on aluminum imports — with counter-measures against iconic U.S. products like Harley Davidson motorcycles, Levi's jeans and bourbon.

The EU threat and Trump's impending announcement on the tariffs were expected to escalate the risk of a trade war, in which nations try to punish each other by hiking taxes on traded goods. Experts say that tends to harm both exporting nations as well as importing countries' consumers, who face higher costs.